Eigencloud’s $6.5B TVL vs EIGEN’s 96% Price Decline

Kraken Deposit Signals Institutional Interest in Ethereum Restaking

Kraken, one of the largest U.S.-based cryptocurrency exchanges, deposited approximately 50,600 ether, worth roughly $1.07 million, into Eigencloud, the Ethereum restaking protocol formerly known as Eigenlayer. The deposit adds to a growing body of evidence that institutional participants are continuing to engage with restaking infrastructure even as the sector’s native tokens have significantly underperformed.

Restaking is a mechanism that allows ETH stakers (i.e. those who have already committed ether to validate the Ethereum network) to re-use that staked collateral as economic security for additional protocols.

Eigencloud introduced restaking as a new cryptoeconomic primitive in 2023, enabling other applications known as actively validated services (AVSs) to borrow Ethereum’s existing security without bootstrapping independent validator sets from scratch. The concept drew significant capital in 2023 and 2024 before new deposit growth moderated in 2025.

Despite a strong TVL base of $6.54 billion on Ethereum (the largest in the restaking category), Eigencloud’s native EIGEN token tells a strikingly different story. EIGEN currently trades at $0.25, compared to its all-time high of $5.65, a decline of approximately 95.6%.

Such a stark gap between TVL strength and token underperformance seems to indicate a pattern common in decentralized finance ( DeFi), wherein a protocol is able to attract substantial capital while its governance or utility token endures sustained selling pressure.

Eigencloud’s TVL Strength Contrasts With EIGEN Token Weakness

Part of EIGEN’s weakness may stem from the protocol’s incentive structure, given that Eigencloud distributes $56.77 million in annualized incentives to stakers and operators, while its fee revenue stands at just $13.6 million on an annualized basis, leaving a net earnings deficit of approximately $12.7 million per year.

This dynamic is not unusual for early-stage DeFi protocols, but it means token holders absorb dilutive emissions without a corresponding fee offset to support price.

Kraken’s continued deposits into Eigencloud suggest that ETH-denominated restaking yield, not token speculation, remains the primary institutional draw. As a major exchange, Kraken would likely be depositing on behalf of clients seeking staking and restaking returns on their ether holdings. Eigencloud raised $220 million in total funding, including a $50 million Series A in 2023 and subsequent rounds from a16z crypto, giving it the runway to weather the current incentive-versus-revenue imbalance.

The restaking sector is facing a critical test in 2026 as it attempts to prove that AVSs generate enough fee revenue to justify the incentive spend required to secure them. Eigencloud holds $6.6 billion of an $11.3 billion total restaking market, giving it the largest platform from which to make that case. But with EIGEN near multi-year lows and annualized losses exceeding $12 million, markets remain visibly skeptical. Kraken’s deposit seems to be a vote of confidence in the yield, not necessarily the token.